The long-term goal of this project is to develop an autologous cell-based therapy to reconstitute the injured lung epithelium utilizing induced pluripotent stem cells (iPSCs), a novel cell population generated by reprogramming fibroblasts into cells virtually indistinguishable from embryonic stem cells (ESCs). The remarkable developmental and differentiation potential of iPSCs makes them attractive candidates for cell-based therapies. Before the full potential of iPSCs can be realized, however, it is first necessary to precisely direct their differentiation in culture and to develop the methodologies needed to sort these cells to purity without contamination by undifferentiated pluripotent cells. This proposal presents three specific aims designed to further advance iPSC research in order to direct the differentiation of these cells into lung epithelial progenitors with a defined cell surfce phenotype. Approaches for utilizing the resulting cells for regeneration of alveolar tissue are presented, and discoveries made in the mouse ESC system in the previous funding cycle are applied to human cells in order to prepare patient-specific lung progenitors from iPSCs. Aim 1 develops methodologies for the isolation of mouse iPSC-derived lung progenitors, using novel cell surface markers that identify Nkx2.1+ endoderm. Aim 2 tests the functional roles of a subset of these surface proteins, and Aim 3 utilizes human iPSCs to establish the surface phenotype of primordial human NKX2.1+ endodermal lung progenitors.